Power play: Woodstock weighs solar energy facility

With a deadline looming, the Woodstock Town Board on May 22 took a tentative step toward a solar-powered future for municipal facilities by authorizing a Kingston firm to seek state funding for the construction of a photovoltaic installation at the site of the town’s wastewater treatment plant off Route 212 east of the hamlet.

By a 3-to-1 vote, with councilman Ken Panza opposed and councilman Jay Wenk absent, the board directed supervisor Jeremy Wilber to sign a nonbinding letter of intent designating the Kingston company, Solartech Renewables, as the town’s “preferred vendor” for the proposed installation. The letter enables Solartech to meet a May 24 application deadline for funding of renewable energy projects through the New York State Energy Research and Development Authority (NYSERDA).

Should Solartech — or, conceivably, any of three other firms that submitted bids for Woodstock’s consideration — secure NYSERDA “incentive” funding, that company would seek to build the solar facility, which it would own, and sell electricity to the town at a discounted rate for 20 years, under a power purchase agreement (PPA). The electricity would be transmitted to town-owned properties over power lines owned and maintained by Central Hudson. After 20 years the town would acquire the solar equipment at fair market value.

Photovoltaic (PV) arrays at Town Hall and the highway garage already meet part of the demand for electricity at those facilities. As envisioned, the proposed “solar farm” at the wastewater plant would generate enough electrical power to satisfy the town’s anticipated total annual consumption, including the needs of properties such as the sewer plant, the town offices on Comeau Drive, and the Community Center on Rock City Road.

As described by Wilber, the proposed PV installation would occupy a cleared area of about two acres between the sewer plant and the Sawkill Creek. A seven-foot cyclone fence would enclose the array, which would consist of solar panels tilted at a desirable angle between 20 and 30 degrees.

Before the vote at the May 22 meeting, Wilber related town attorney Rod Futerfas’s legal opinion that the letter of intent would indeed be nonbinding on the town, serving only to provide the chosen vendor with a prospective project to present to NYSERDA. The town’s participation on a PPA is contingent on the vender’s receipt of NYSERDA funding. Meanwhile, in recent interviews the supervisor emphasized that the project would not advance without the evident support of the public and a thorough examination by the board of its financial and environmental implications.

“This cannot succeed without the public’s support,” said Wilber, noting that a “public airing,” as opposed to a formal public hearing, would take place if the board chose to pursue the project following NYSERDA’s decision on the funding application, which is expected in July or August. “All we are studying is the possibility of Woodstock’s joining the vanguard of green energy.” Alluding to the price of a postage stamp, he added, “All it has cost us so far is 48 cents.”

Details of proposal

The Solartech proposal specifies a 750 kilowatt (kW) array that would initially produce between 900,000 and 920,000 kilowatt hours (kWh) annually. The company would sell electricity to the town at a rate of 10 cents per kWh, which would escalate after the first year by 2.4 percent annually. The estimated total cost to the town of a 20-year PPA with Solartech is $2,345,334, including $145,696 in the final year of the agreement.

Three other New York State companies — Lighthouse Solar, of New Paltz; Mercury Solar Systems, of Port Chester; and SolarCity, of Albany — also submitted proposals. The Town Board opened the sealed proposals at a special meeting on May 18, and resolved to choose a preferred vendor on May 22, allowing council members three days to review the submissions and, subsequently, the chosen firm a couple of days to meet NYSERDA’s application deadline.

The vendors submitted proposals, as opposed to formal bids, because the town was not engaged in a conventional procurement process, in which it would be obliged to accept the low bid for, say, the purchase of a truck using taxpayer money. Consequently, the three unsuccessful “bidders” in the recent competition are at least technically eligible to seek NYSERDA funding for the Woodstock project, although they seem unlikely to do so without the town’s endorsement.

In choosing Solartech the board accepted the recommendation of Randolph Horner, a renewable energy consultant who has served as the town’s “procurement agent” in soliciting proposals by solar energy companies. According to Horner, who is concurrently working with the town of Esopus on a similar, but larger, proposed solar project, the cost to Woodstock of a 20-year PPA with Solartech would be $200,000 less than an agreement with SolarCity and $600,000 less than a PPA with either Lighthouse or Mercury.

Swaying councilwoman Cathy Magarelli in favor of the Solartech proposal, she explained, was the company’s status as a local firm and a domestic manufacturer, at its base in Kingston, of solar panels. Earlier this month, the federal government imposed “antidumping” tariffs of more than 31 percent on solar panels imported from China. Councilman Bill McKenna and Wilber joined Magarelli in the vote to designate Solartech the vendor of choice. Wenk, who was absent from the board’s May 18 and May 22 special meetings, was reportedly out of town.

Dissenting views

Horner, a Woodstock resident who played an instrumental role in the PV installation at Town Hall and the 2007 passage of the Carbon Neutral Initiative (CNI), in which the town pledged to achieve net-zero carbon emissions by 2017, has served as the procurement agent for the current project at no cost to the town. He would be compensated at a later date if a vendor, presumably Solartech, receives NYSERDA funding and executes a PPA with the town.

“Five years and two months ago, the town committed itself to carbon neutrality in a decade,” said Horner in an interview following the May 22 meeting. “Nothing has been done. My awareness of the (NYSERDA) subsidy coming up enabled the town to designate a vendor to seek a subsidy that would benefit the town. But for my initiative, the town wouldn’t have had the opportunity to discuss this with anyone. The whole goal is for town systems to generate an energy capacity equal to the town’s needs and to place a ceiling on electricity costs for years to come, based on market factors and currency inflation.” He described the proposed system as “totally renewable.”

Panza, however, clashed repeatedly with Horner. The councilman, who routinely produces and distributes, by e-mail, independent research on matters facing the town, did the same in this case. In one instance Panza circulated data that demonstrated, he said, that municipal electricity costs would actually increase under the proposed solar array over the approximately $100,000 the town paid Central Hudson for electricity in 2011.

That total, said Panza, included about $50,000 for the delivery of electricity over Central Hudson power lines and an equal amount for the company’s generation of electricity. Since the $50,000 delivery charge would remain under the PV system, such a system would have cost the town $170,000 last year, or $70,000 more than was paid to Central Hudson, according to his analysis.

In other instances Panza challenged Horner’s estimate of the town’s total power consumption in 2011 — 614 kWh, said Panza, citing the town’s audited financial report; 791 kWh, countered Horner, deeming the report erroneous. And Panza warned that the nonbinding letter of intent could leave the town vulnerable to lawsuits if the proposed project fell through.

Panza also expressed skepticism at what Horner asserted was a typographical error in Solartech’s original proposal, which cited an annual “escalator” percentage of 5 percent. The company was permitted to revise the figure to 2.4 percent before the board’s vote on the letter of intent.

Nothing definitive will happen anytime soon, with a NYSERDA award decision months away and Woodstock’s commitment to a PPA contingent on the Town Board’s satisfaction that the proposed project has the public’s support and is financially and environmentally sound. Wilber, for his part, plans to conduct due diligence by consulting experts including NYSERDA officials and State Assemblyman Kevin Cahill, who chairs the Assembly’s committee on energy.++

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